The Composable NFT Standard

January 18, 2022 | 4 minute read

Today we’re excited to announce that Multicoin Capital has co-led a $46M strategic investment in Metaplex alongside our friends at Jump Crypto, with participation from Solana Ventures, Alameda Research, Samsung Next, Sino Global Capital, Animoca, Cultur3 Capital, Blue Pool—in addition to 90 other supporters.

Metaplex is a decentralized protocol paired with an open-source web framework that helps artists, brands, and creators create NFTs and launch self-hosted storefronts. Metaplex is the dominant NFT standard for Solana, powering the vast majority of NFT activity.

Metaplex itself has driven more than $1.2B in NFT sales since launching in June 2021, representing over 5.5 million NFTs, 85,000 projects, and more than 600,000 active collectors. The 200 most popular NFT projects on Solana collectively represent over a $1B market capitalization, with collections such as Solana Monkey Business, Degenerate Ape Academy, and Shadowy Super Coder DAO leading the charts. Metaplex standards and tools have found a massive market, drawn in users, and started scaling — all before the first official fundraise.

NFTs are rapidly reshaping communities around media, culture, sports, and general purpose internet applications. A huge cohort of influential creators are beginning to recognize this, and are investing in this Metaplex round accordingly, including Michael Jordan, William Wesley, Allen Iverson, Shari Glazer, RÜFÜS DU SOL, and Cozomo de’ Medici, and many others. NFT collections built over the Metaplex standard represent some of the most important creators, investors and entertainers in the world. We attribute this to Metaplex’s obsession with out-of-the-box usability, the radical cost advantages offered by the Solana blockchain, and the vast design space of on-chain composable assets.

The adoption of NFTs represents a landmark moment in the Web3 adoption cycle. Hundreds of thousands of uninitiated users are willing to onboard to crypto rails despite the points of friction in the process. The events of the past year signal mainstream understanding of one of the core tenets of crypto — ownership. The world is starting to accept the value proposition of decentralized networks as sovereign, immutable, and censorship-resistant ledgers.

While many think of NFTs as JPEGs with some provenance or ownership guarantees provided by blockchains, they hold the potential for utility far beyond this monolith. NFTs are among the most flexible data structures in crypto, with use cases ranging from in-game assets to financial contracts and everything in between. Aside from ownership, the key unlock of Web3 is the notion of composability, or the idea that assets in any given environment can be transposed into other environments seamlessly.

To achieve ownership and composability, we require standards that create necessary social consensus. In society, we use laws and regulations to develop a collective understanding of property rights and expected behavior. On blockchains, this understanding comes from the standards around which developers build protocols and applications.

Our thesis for Metaplex is simple: in developing canonical standards and driving their usage through modular products and initiatives, Metaplex becomes the base layer upon which all value is exchanged in the form of NFTs.

The Metaplex community continues to develop novel issuance and distribution mechanisms in products such as Candy Machine, Auction House, and Gumdrop — each of which gives creators granular control over how their collections are launched. Open source reference implementations and SDKs have made it easy for developers to deploy and scale new applications. Core repositories have been forked over 15,000 times by over 2,600 developer teams in applications such as Magic Eden, Fractal, HEIR, Star Atlas, Aurory, and Genopets.

As more assets and applications deploy on Solana using the Metaplex standard, we will begin to see parts of the Metaverse take shape in the form of massively scaled, interoperable worlds. Imagine an in-game asset earned on Star Atlas being auctioned on Fractal, fractionalized using Bridgesplit, and finally owned collectively by a DAO over Squads. The potential for novel forms of interaction and engagement in these worlds is limitless, and it will all be enabled by the standards created by Metaplex.

Solana is the only blockchain that maintains composability while being accessible to everyone on the planet, and we believe that Metaplex will play a critical role in the development of consumer facing products that onboard the next 100M users into crypto.

Disclosures: Multicoin has established, maintains and enforces written policies and procedures reasonably designed to identify and effectively manage conflicts of interest related to its investment activities.